PROSPECTUS
4,055,978 Shares
WHITTMAN-HART, INC.
COMMON STOCK
par value $.001 per share
The shares of common stock, $.001 par value per share ("Common Stock"),
covered by this Prospectus may be offered and issued from time to time by
Whittman-Hart, Inc. (the "Company") in connection with acquisitions of other
businesses, real or personal properties, or securities in business combination
transactions in accordance with Rule 415(a) (1) (viii) of Regulation C under the
Securities Act of 1933, as amended (the "Securities Act"), or otherwise under
Rule 415 promulgated under the Securities Act. This Prospectus may also be used,
with the Company's prior consent, by persons who have received or will receive
shares in connection with acquisitions and who wish to offer and sell such
shares under circumstances requiring or making desirable its use. See
"Securities Covered by this Prospectus."
SEE RISK FACTORS STARTING ON PAGE 4 FOR A DISCUSSION OF CERTAIN FACTORS TO
BE CONSIDERED BY PROSPECTIVE INVESTORS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY. NEITHER THIS PROSPECTUS NOR ANY SUPPLEMENT HERETO CONSTITUTES
AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY THE SHARES OF COMMON
STOCK OFFERED HEREBY IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER. THE DELIVERY OF THIS PROSPECTUS OR ANY SUPPLEMENT
HERETO, SHALL NOT AT ANY TIME, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS NOT BEEN ANY CHANGE IN THE FACTS SET FORTH IN THIS PROSPECTUS,
ANY SUPPLEMENT HERETO, THE INFORMATION INCORPORATED BY REFERENCE HEREIN OR THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
The date of this Prospectus is March 31, 1998
Whittman-Hart-Registered Trademark, Making Information Technology Work-
Registered Trademark - and We Are IT-Registered Trademark-are registered service
marks of the Company. Windows-Registered Trademark- is a registered trademark of
Microsoft Corporation. All other trademarks, service marks and trade names
referred to in this Prospectus are the property of their respective owners.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed with the Commission by Whittman-Hart are
incorporated into this Prospectus by reference:
(i) the Company's Annual Report on Form 10-K for the year ended
December 31, 1997; and
(ii) the Company's Registration Statement on Form 8-A.
All documents filed by Whittman-Hart pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act, after the date of this Prospectus and prior to the
termination of the offering hereunder shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained herein or in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. COPIES OF THESE DOCUMENTS (OTHER THAN EXHIBITS
THERETO) ARE AVAILABLE WITHOUT CHARGE, UPON WRITTEN OR ORAL REQUEST BY A PERSON
TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED, FROM WHITTMAN-HART, INC. 311 SOUTH
WACKER DRIVE, 35TH FLOOR, CHICAGO, ILLINOIS 60606; TELEPHONE NUMBER (312) 922-
9200. IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE
MADE AT LEAST FIVE BUSINESS DAYS PRIOR TO THE DATE ON WHICH A FINAL INVESTMENT
DECISION IS TO BE MADE.
SECURITIES COVERED BY THIS PROSPECTUS
The shares of Common Stock covered by this Prospectus are available for use
in future acquisitions of other businesses, real or personal properties, or
securities in business combination transactions in accordance with Rule
415(a)(1)(viii) of Regulation C under the Securities Act or otherwise under Rule
415. Such acquisitions may be made directly by the Company or indirectly
through a subsidiary, may relate to businesses or securities of businesses
similar or dissimilar to those of the Company or to properties of a type which
may or may not currently be used by the Company, and may be made in connection
with the settlement of litigation or other disputes. The consideration offered
by the Company in such acquisitions, in addition to the shares of Common Stock
offered by this Prospectus, may include cash, debt, or other securities (which
may be convertible into shares of Common Stock covered by this Prospectus), or
assumption by the Company of liabilities of the business, properties, or
securities being acquired or of their owners, or a combination thereof. It is
contemplated that the terms of acquisitions will be determined by negotiations
between the Company and the owners of the businesses, properties, or securities
to be acquired, with the Company taking into account such factors as the quality
of management, the past and potential earning power, growth and appreciation of
the businesses, properties, or securities acquired, and other relevant factors,
and it is anticipated that shares of Common Stock issued in acquisitions will be
valued at a price reasonably related to the market value of the Common Stock
either at the time the terms of the acquisition are tentatively agreed upon or
at or about the time or times of delivery of the shares.
The Company may from time to time, in an effort to maintain an orderly
market in the Common Stock, negotiate agreements with persons receiving Common
Stock covered by this Prospectus that will limit the number of shares that may
be sold by such persons at specified intervals. Such agreements may be more
restrictive than restrictions on sales made pursuant to the exemption from
registration requirements of the Securities Act, including the requirements
under Rule 144 or Rule 145(d), and certain persons party to such agreements may
not otherwise be subject to such Securities Act requirements. The Company
anticipates that, in general, such negotiated agreements will be of limited
duration and will permit the recipients of Common Stock issued in connection
with acquisitions to sell up to a specified number of shares per business day or
days.
With the consent of the Company, this Prospectus may also be used by
persons who have received or will receive from the Company Common Stock covered
by this Prospectus and who may wish to sell such stock under circumstances
requiring or making desirable its use. The Company's consent to such use may be
conditioned upon such persons' agreeing not to offer more than a specified
number of shares following supplements or amendments to this Prospectus, which
the Company may agree to use its best efforts to prepare and file at certain
intervals. The Company may require that any such offering be effected in an
organized manner through securities dealers.
Sales by means of this Prospectus may be made from time to time privately
at prices to be individually negotiated with the purchasers, or publicly through
transactions in the over-the-counter market (which may involve block
transactions), at prices reasonably related to market prices at the time of sale
or at negotiated prices. Broker-dealers participating in such transactions may
act as agent or as principal and, when acting as agent, may receive commissions
from the purchasers as well as from the sellers (if also acting as agent for the
purchasers). The Company may indemnify any broker-dealer participating in such
transactions against certain liabilities, including liabilities under the
Securities Act. Profits, commissions, and discounts on sales by persons who may
be deemed to be underwriters within the meaning of the Securities Act may be
deemed underwriting compensation under the Securities Act.
Stockholders may also offer shares of stock covered by this Prospectus by
means of prospectuses under other registration statements or pursuant to
exemptions from the registration requirements of the Securities Act, including
sales which meet the requirements of Rule 144 or Rule 145(d) under the
Securities Act, and stockholders should seek the advice of their own counsel
with respect to the legal requirements for such sales.
This Prospectus may be supplemented or amended from time to time to reflect
its use for resales by persons who have received shares of Common Stock for whom
the Company has consented to the use of this Prospectus in connection with
resales of such shares.
THE COMPANY
Whittman-Hart, Inc. ("Whittman-Hart" or the "Company") provides strategic
information technology business solutions designed to improve its clients'
productivity and competitive position. The Company offers its clients a single
source for a comprehensive range of services required to successfully design,
develop and implement integrated solutions in the client/server, open systems,
midrange and mainframe computing environments. Among the services offered by
the Company are systems integration; strategic information technology planning;
software development; package software implementation; business process
reengineering; organizational change management; networking and connectivity;
conventional and multimedia documentation and training; design and
implementation of collaborative computing solutions; and design and
implementation of electronic commerce solutions (such as Internet/intranet and
electronic data interchange). The Company believes this breadth of services
fosters long-term client relationships, affords cross-selling opportunities and
minimizes the Company's dependence on any single technology.
The address of the Company is 311 South Wacker Drive, 35th Floor, Chicago,
Illinois 60606, and its telephone number is (312) 922-9200.
RISK FACTORS
In addition to the other information set forth in this Prospectus,
prospective investors should consider carefully the following factors. This
Prospectus contains certain forward-looking statements that involve substantial
risks and uncertainties. when used in this Prospectus, the words "anticipate,"
"believe," "estimate," and "expect" and similar expressions as they relate to
the Company or its management are intended to identify such forward-looking
statements. The Company's actual results, performance or achievements could
differ materially from the results, performance or achievements expressed in, or
implied by, these forward-looking statements. Factors that could cause or
contribute to such differences include, but are not limited to, those described
in the following section.
ATTRACTION AND RETENTION OF EMPLOYEES
The Company's business involves the delivery of professional services and
is labor-intensive. The Company's success depends in large part upon its ability
to attract, develop, motivate and retain highly skilled technical employees.
Qualified technical employees are in great demand and are likely to remain a
limited resource for the foreseeable future. There can be no assurance that the
Company will be able to attract and retain sufficient numbers of highly skilled
technical employees in the future. The Company has historically experienced
turnover rates which it believes are consistent with industry norms. An increase
in this rate could have a material adverse effect on the Company's business,
operating results and financial condition, including its ability to secure and
complete engagements.
MANAGEMENT OF GROWTH
The Company is currently experiencing rapid growth that has strained, and
could continue to strain, the Company's managerial and other resources. The
Company's ability to manage the growth of its operations will require it to
continue to improve its operational, financial and other internal systems and to
attract, develop, motivate and retain its employees. If the Company's
management is unable to manage growth or new employees are unable to achieve
anticipated performance levels, the Company's business, operating results and
financial condition could be materially and adversely affected.
PROJECT RISKS
Many of the Company's engagements involve projects that are critical to the
operations of its clients' businesses and provide benefits that may be difficult
to quantify. The Company's failure or inability to meet a client's expectations
in the performance of its services could result in a material adverse change to
the client's operations and therefore could give rise to claims against the
Company or damage the Company's reputation, adversely affecting its business,
operating results and financial condition.
VARIABILITY OF QUARTERLY OPERATING RESULTS
Variations in the Company's revenues and operating results occur from time
to time as a result of a number of factors, such as the significance of client
engagements commenced and completed during a quarter, the number of business
days in a quarter, timing of branch and service line expansion activities, the
timing of corporate expenditures and employee hiring and utilization rates. The
timing of revenues is difficult to forecast because the Company's sales cycle
can be relatively long and may depend on factors such as the size and scope of
assignments and general economic conditions. Because a high percentage of the
Company's expenses are relatively fixed, a variation in the number of client
assignments or the timing of the initiation or the completion of client
assignments, particularly at or near the end of any quarter, can cause
significant variations in operating results from quarter to quarter and could
result in losses to the Company. In addition the Company's engagements generally
are terminable by the client without penalty. Although the number of consultants
can be adjusted to correspond to the number of active projects, the Company must
maintain a sufficient number of senior consultants to oversee existing client
projects and assist with the Company's sales force in securing new client
assignments.
COMPETITION
The market for information technology services includes a large number of
competitors, is subject to rapid change and is highly competitive. Primary
competitors include participants from a variety of market segments, including
"Big Six" accounting firms, systems consulting and implementation firms,
application software firms, service groups of computer equipment companies,
facilities management companies, general management consulting firms and
programming companies. In addition, the Company competes with its clients'
internal resources, particularly where these resources represent a fixed cost to
the client. Such competition may impose additional pricing pressures on the
Company. There can be no assurance that the Company will compete successfully
with its existing competitors or with any new competitors.
RELIANCE ON KEY EXECUTIVES
The success of the Company is highly dependent upon the efforts and
abilities of its executive officers, particularly Mr. Robert Bernard, the
Company's founder and Chief Executive Officer. Although these executives have
entered into employment agreements containing noncompetition, nondisclosure and
nonsolicitation covenants, these contracts do not guarantee that these
individuals will continue their employment with the Company. The loss of the
services of any of these key executives for any reason could have a material
adverse effect upon the Company's business, operating results and financial
condition.
CONCENTRATION OF REVENUES
The Company derives a significant portion of its revenues from a relatively
limited number of clients. There can be no assurance that these clients will
continue to engage the Company for additional projects or do so at the same
revenue levels. Clients engage the Company on an assignment-by-assignment
basis, and a client can generally terminate an assignment at any time without
penalty. The loss of any significant client could have a material adverse
effect on the Company's business, operating results and financial condition.
RAPID TECHNOLOGICAL CHANGE; DEPENDENCE ON NEW SOLUTIONS
The Company's success will depend in part on its ability to develop
information technology solutions that keep pace with continuing changes in
information technology, evolving industry standards and changing client
preferences. There can be no assurance that the Company will be successful in
adequately addressing these developments on a timely basis or that, if these
developments are addressed, the Company will be successful in the marketplace.
In addition, there can be no assurance that products or technologies developed
by others will not render the Company's services uncompetitive or obsolete. The
Company's failure to address these developments could have a material adverse
effect on the Company's business, operating results and financial condition.
RISKS RELATED TO POSSIBLE ACQUISITIONS
The Company may expand its operations through the acquisition of additional
businesses. There can be no assurance that the Company will be able to
identify, acquire or profitably manage additional businesses or successfully
integrate any acquired businesses into the Company without substantial expenses,
delays or other operational or financial problems. Further, acquisitions may
involve a number of special risks or effects, including diversion of
management's attention, failure to retain key acquired personnel, unanticipated
events or circumstances, legal liabilities and amortization of acquired
intangible assets and other one-time or ongoing acquisition related expenses,
some or all of which could have a material adverse effect on the Company's
business, operating results and financial condition. Client satisfaction or
performance problems at a single acquired firm could have a material adverse
impact on the reputation of the Company as a whole. In addition, there can be
no assurance that acquired businesses, if any, will achieve anticipated revenues
and earnings. The failure of the Company to manage its acquisition strategy
successfully could have a material adverse effect on the Company's business,
operating results and financial condition.
CONTROL BY PRINCIPAL STOCKHOLDER
As of January 1, 1998, Mr. Bernard beneficially owned approximately 33%
of the Company's outstanding shares of Common Stock. As a result, Mr. Bernard
will, as a practical matter, continue to be able to control the outcome of
matters requiring a stockholder vote, including the election of the members of
the Board of Directors, thereby controlling the affairs and management of the
Company. Such control could adversely affect the market price of the Common
Stock or delay or prevent a change in control of the Company.
INTELLECTUAL PROPERTY RIGHTS
The Company's success is dependent upon certain methodologies it utilizes
in designing, installing and integrating computer software and systems and other
proprietary intellectual property rights. The Company's business includes the
development of custom software in connection with specific client engagements.
Ownership of such software is generally assigned to the client. The Company
also develops certain foundation and application software products, or software
"tools," which remain the property of the Company.
The Company relies upon a combination of nondisclosure and other
contractual arrangements and trade secret, copyright and trademark laws to
protect its proprietary rights and the proprietary rights of third parties from
whom the Company licenses intellectual property. The Company enters into
confidentiality agreements with its employees and limits distribution of
proprietary information. There can be no assurance that the steps taken by the
Company in this regard will be adequate to deter misappropriation of proprietary
information or that the Company will be able to detect unauthorized use and take
appropriate steps to enforce its intellectual property rights.
Although the Company believes that its services do not infringe on the
intellectual property rights of others and that it has all rights necessary to
utilize the intellectual property employed in its business, the Company is
subject to the risk of claims alleging infringement of third-party intellectual
property rights. Any such claims could require the Company to spend significant
sums in litigation, pay damages, develop non-infringing intellectual property or
acquire licenses to the intellectual property which is the subject of asserted
infringement.
FIXED-BID PROJECTS
The Company undertakes certain projects billed on a fixed-bid basis, which
is distinguishable from the Company's principal method of billing on a time and
materials basis, and undertakes other projects on a fee-capped basis. The
failure of the Company to complete such projects within budget or below the cap
would expose the Company to risks associated with cost overruns, which could
have a material adverse effect on the Company's business, operating results and
financial condition.
LIMITED TRADING HISTORY OF COMMON STOCK; STOCK PRICE VOLATILITY
The Common Stock first became publicly traded on May 3, 1996 after the
Company's initial public offering at $8 per share. The market price of the
Common Stock has and could continue to fluctuate substantially due to a variety
of factors, including quarterly fluctuations in results of operations, adverse
circumstances affecting the introduction or market acceptance of new products
and services offered by the Company, announcements of new products and services
by competitors, changes in the information technology environment, changes in
earnings estimates by analysts, changes in accounting principles, sales of
Common Stock by existing holders, loss of key personnel and other factors. The
market price for the Company's Common Stock may also be affected by the
Company's ability to meet analysts' expectations, and any failure to meet such
expectations, even if minor, could have a material adverse effect on the market
price of the Company's Common Stock. In addition, the stock market is subject
to extreme price and volume fluctuations. This volatility has had a significant
effect on the market prices of securities issued by many companies for reasons
unrelated to the operating performance of these companies. In the past,
following periods of volatility in the market price of a company's securities,
securities class action litigation has often been instituted against such a
company. Any such litigation instigated against the Company could result in
substantial costs and a diversion of management's attention and resources, which
could have a material adverse effect on the Company's business, operating
results and financial condition. See "Price Range of Common Stock."
CERTAIN ANTI-TAKEOVER EFFECTS
The Company's Certificate of Incorporation and By-Laws and the Delaware
General Corporation Law include provisions that may be deemed to have anti-
takeover effects and may delay, defer or prevent a takeover attempt that
stockholders might consider in their best interests. These include By-Law
provisions under which only the Chairman of the Board or the President may call
meetings of stockholders and certain advance notice procedures for nominating
candidates for election to the Board of Directors. Directors of the Company are
divided into three classes and are elected to serve staggered three-year terms.
The Board of Directors of the Company is empowered to issue up to 3,000,000
shares of preferred stock and to determine the price, rights, preferences and
privileges of such shares, without any further stockholder action. The
existence of this "blank-check" preferred stock could render more difficult or
discourage an attempt to obtain control of the Company by means of a tender
offer, merger, proxy contest or otherwise. In addition, this "blank-check"
preferred stock, and any issuance thereof, may have an adverse effect on the
market price of the Company's Common Stock. See "Description of Capital Stock -
Delaware Law and Certain Certificate of Incorporation and By-Law Provisions;
Anti-Takeover Effects."
DIVIDEND POLICY
Other than certain tax distributions made in connection with an earlier
restructuring, the Company has never made any distributions with respect to its
equity securities. The Company does not anticipate paying any cash dividends on
its Common Stock in the foreseeable future. The Company currently intends to
retain future earnings to fund the development and growth of its business.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission"), a Registration Statement on Form S-4 under the Securities Act,
with respect to the shares of Common Stock offered hereby. This Prospectus does
not contain all of the information set forth in the Registration Statement,
certain portions of which have been omitted as permitted by the rules and
regulations of the Commission. For further information with respect to the
Company and the Common Stock, reference is made to the Registration Statement,
including the exhibits and schedules thereto. Statements contained in this
Prospectus as to the contents of any contract, agreement or any other document
referred to herein are not necessarily complete; with respect to each such
contract, agreement or document filed as an exhibit to the Registration
Statement, reference is made to such exhibit for a more complete description of
the matters involved, and each such statement shall be deemed qualified in its
entirety by such reference. The Registration Statement, including the exhibits
and schedules thereto, may be inspected without charge at the Commission's
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549 and copies of
either of them or any part thereof may be obtained from such office, upon
payment of the fees prescribed by the Commission. The Registration Statement,
including the exhibits and schedules thereto, is also available on the
Commission's Web site at http://www.sec.gov.
The Company is subject to the informational requirements of the Securities
Exchange Act 0f 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy material and other information concerning the
Company can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549
or at its regional offices at 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and 7 World Trade Center, Suite 1300, New York, New York 10048.
Copies of such material can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates. The Company's Common Stock is listed on the Nasdaq National Market, and
such reports, proxy material and other information can also be inspected at the
offices of The Nasdaq Stock Market, Inc., 1735 K Street, N.W., Washington, D.C.
20549.
